Montgomery County Energy Tax Hike - Update
April 30, 2010
If what I heard during and after a Montgomery County Council joint meeting yesterday is any indication, I have to warn businesses and property owners in the county to get ready to open your wallets a lot wider than you already do now. Unless something happens behind the scenes in the next month or so, the Council is going to hike your energy rates. Big time.
Thursday's joint workgroup meeting of council's Management & Fiscal Policy committee and Transportation, Infrastructure, Energy & Environment committee attracted quite a few concerned businesspeople, officials from various Chambers of Commerce, and even Pepco officials. They came to hear council's reaction to County Executive Ike Leggett's proposal to increase the energy tax by 100% on each electrical kilowatt and natural-gas therm burned for both residential and commercial account holders. Other forms of energy, like coal, propane and heating oil, are also covered by the increase.
If you think that number is scary, there's more: Leggett's proposal would really hurt commercial account holders, because they already pay almost three times more in energy taxes than do residential customers.
All of these actions are understandably sending mixed signals to the business community in Montgomery County, as well as to companies thinking about moving here or investing here. An article in the Gazette spotlights this confusion. It also quotes Electric Advisors President Russell Lacey as saying these new costs would just be passed onto consumers, and would make it tough for businesses to hire employees.
Meantime, the signals coming out of yesterday's committee meeting were just as cloudy. A lot of the discussion centered around making the tax split between commercial and residential more fair and even. Several ideas were suggested; nothing was nailed down.
It must be pointed out that yesterday's meeting was just a worksession involving two of the council's committees. No vote could be taken, since it wasn't a full session of the council. What's more, there's going to be another hearing on the hike in May before the council even votes on it. And I'm sure much more information will be generated, exchanged and discussed behind council's closed doors in the meantime.
But from what Council President Nancy Floreen told a small group of us after the meeting, the splits being considered would still hit the commercial sector hard. The figures she mentioned would really put the hurt on businesses and property owners here in Montgomery County.
There's so much detail I'd love to get into here; if I did, though, this post would be much, much longer -- and it's getting really long already, right?One big detail I'll point out, though, is if a big energy tax hike is passed, Montgomery County would hold the dubious honor of having the highest energy taxes in the DC/Baltimore metro region. By far.
Some people might say, "Hey, Bob, won't your company benefit from this new tax? After all, if you can lower a businesses' or property owner's rates, you can actually soften the blow of these new taxes."
I cannot deny that we'd have the potential to see more business in Montgomery County. I'll leave the specific reasons out of this discussion for now, because we're not sure what will come of council's further discussions and investigations.
But I'd really, really hate to see new business come our way as a result of an onerous tax. Don't get me wrong. We'll absolutely help commercial account holders hedge against a huge increase in energy taxes. What I'd much rather do is assist them in lowering their rates, so they can have more cash in their pockets. That money can buy a lot of items and services to help a company grow, hire more people, and then grow even more. That's how an economy thrives.
Here's an example of both scenarios at work. I'm currently negotiating electricity rates for an office condo building in the county that is master metered; in other words, only one electric meter serves all of the tenants in the building. The property itself uses about one million kilowatt hours (kWh) of electricity per year.
The building's condo association currently pays Pepco 9.609 cents per kWh for electricity supply and transmission. I've quoted them pricing that's around 8.3 cents per kWh for a 2-year deal. With the building using 89,400 kWh of power (as shown on its March, 2010 statement), we would have lowered its power supply/transmission rate by 14%, or $1210, for that month. Pretty good, right?
Well, if the 100% Leggett-proposed rate hike were in place for that same billing period, the association's energy tax would be higher by $1265. The tax would have slightly more than canceled out our lower rate. Of course, the overall bill would still be lower, because of our negotiation. Yet the association would still be paying $1265 more in taxes.
If the tax would have been in place without our pricing? The association's original bill would have been even higher by that $1265 figure.
Meantime, here's another more-dramatic example, from the Gazette article:
Suburban Hospital in Bethesda spends about $342,000 annually on energy taxes, according to Leslie Ford Weber, senior vice president of government and community relations for the hospital. If the increase passes, the hospital will pay about $700,000.
If you are concerned about this new tax, and what it will do to county businesses, you can visit our "action" post of yesterday to find out how you can compute your own businesses' tax, and how you can "fight the power."
Next week, we'll look at the residential energy market. The actual dollar figures aren't nearly as dramatic, but there's no doubt that this new tax -- no matter what form it eventually takes -- will put the hurt on Montgomery County residents at home, too.
Every golfer has a round they remember. It might be a personal best, a long putt that somehow found the cup, or a perfect drive down the middle of the fairway. For me, the most meaningful round has less to do with my score and more to do with the people gathered around the first tee. That round is the Purple Tee Classic. On Thursday, September 17, 2026 , Metro Bethesda Rotary will host the 20th Annual Purple Tee Classic at Whiskey Creek , with a 10:00 a.m. shotgun start. This will be my third year leading the tournament, and my final year in that leadership role. That makes this year especially meaningful to me. More Than a Golf Tournament The Purple Tee Classic is a day of golf, but it is really about much more than a day on the course. It brings together business owners, community members, Rotarians, friends, families, veterans, and first responders around a shared purpose. The fundraiser supports veterans and first responders, people who have served, protected, and supported our communities in ways most of us will never fully understand. Golf gives us the setting. Service gives the day its meaning. That is what I value most about Rotary. The organization creates opportunities for people to put relationships, resources, and time to work for something larger than themselves. The Rotary principle of “Service Above Self” is not just a phrase. It is something we are asked to live out by showing up, contributing, and following through. The Purple Tee Classic is one of the clearest examples of that principle in action. Why This Final Year Matters Leading a tournament like this takes more than setting a tee time and asking people to come out and play. It takes planning, coordination, communication, fundraising, and a team willing to handle the many details most participants will never see. That is one of the biggest things I want to say clearly this year: this event is absolutely a team effort. The Metro Bethesda Rotary members involved in this committee do a tremendous amount behind the scenes. They help plan, coordinate, communicate, recruit sponsors and players, and keep things moving in all the ways that make an event like this possible. A lot of that work is not flashy. It is steady, thoughtful, behind-the-scenes effort that helps turn a good idea into a real event that serves real people. I have been fortunate to work alongside fellow Rotary members who care deeply about Rotary’s mission and the causes the tournament supports. I am genuinely grateful for their time, commitment, and willingness to do the work that needs to get done. Events like this do not come together because of one person. They come together because a group of committed people keeps showing up and doing their part. It also takes the support of a broader community. Over the past three years, I have seen how a simple invitation, to play a round of golf or contribute an auction item, can become part of a much larger effort. As I prepare for my final year leading the Purple Tee, I am thinking less about the fact that my leadership role is ending and more about what I hope continues. I hope the tournament continues to bring people together. I hope new sponsors and players discover the value of supporting a community event with a clear purpose. And I hope every participant leaves Whiskey Creek remembering that the best part of the day was never just the golf. It was the difference we helped make by showing up. How You Can Help There are several ways to support this milestone event: Become a tournament sponsor. Help strengthen the event while putting your organization in front of an engaged local community. Register a foursome . Bring colleagues, friends, clients, or family members for a meaningful day on the course. Sponsor a veteran or first responder. Help someone enjoy a round of golf and participate in the Purple Tee experience. Donate an item or experience. Raffle and auction contributions add energy to the day and help expand the event’s fundraising potential. Every form of participation matters. Not everyone can sponsor at the same level, and not everyone plays golf. But everyone can consider whether they, or someone they know, might be able to help. Key Takeaways The 20th Annual Purple Tee Classic will take place at Whiskey Creek on September 17, 2026. This is my third year leading the tournament and my final year in that leadership role. The fundraiser supports veterans and first responders. Sponsors, foursomes, individual player support, and donated auction or raffle items are all important. Rotary has given me the opportunity to serve with people who care about their community and are willing to turn good intentions into action. I am grateful for that opportunity, grateful for the people I get to work alongside, and determined to make this final year leading the Purple Tee Classic a memorable one. If you would like to support the event, please visit purpletee.fundraiser.bid . You can also message me directly if you are interested or know someone who may want to help. One last round in this leadership role. One more opportunity to bring people together. And one more chance to support the veterans and first responders who deserve our gratitude.
Your guide to Energy Incentives for Maryland is here
For most business owners, the monthly utility bill is just another line item to be paid and filed away. You glance at the total, ensure it isn't astronomically higher than last month, and move on. But in 2026, with energy markets facing unprecedented volatility and complex new tariff structures, that "glance and pay" strategy is costing American businesses billions in overpayments. The good news? You don’t have to just accept these costs as the price of doing business. Everyone is talking about utility bill audits because they have transitioned from a "nice-to-have" occasional check to a critical financial strategy. At Electric Advisors, Inc., we’ve seen firsthand how a meticulous review of historical invoices can uncover significant refunds and permanent rate reductions.